UAL board nods to two union pacts

CHICAGO (CBS.MW) - The UAL Corp. board and labor committee approved two preliminary pacts reached with the leaderships groups of the pilots and flight attendants unions, the carrier said Tuesday.

The agreements are part of the parent of United Airlines
UAL, +1.34%
efforts to take out $5.8 billion in operating expenses as it struggles to stay out of bankruptcy.

Shares of UAL rode up on the news, rising 3.4 percent to finish the session at $3.69.

The agreements that detail the unions' participation still need ratification by rank-and-file members of the Air Line Pilots Association and the Association of Flight Attendants. Both unions are in the process of soliciting those votes, the company said. The votes are expected to be tallied by the end of the month.

Over the weekend, the flight attendants union said it will cut out $412 million in wages and concessions over 5 1/2 years. That came only a day after the airline said it would lay off 2,700 attendants by the end of January.

A week ago, the pilots' union agreed to cutbacks of $2.2 billion over the same period.

The carrier still needs to reach an agreement with the International Association of Machinists, which represents the largest employee union group.

UAL's senior executives are in discussions with the Air Transportation Stability Board for back up of $1.8 billion of $2 billion in loans.

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